KUCHING | The Federation of Malaysian Manufacturers (FMM) has hit out at the government’s decision to limit the hiring of foreign workers to only the construction, plantation and agriculture sectors, once the freeze on employment is lifted next year.

Its president Tan Sri Soh Thian Lai said the announcement was very sudden and lacked details on the mechanism of implementation, adding the decision was “shocking, unacceptable and done without prior consultation with stakeholders”.

“The government has not given due consideration to the significant impact on business sustainability and the socio-economic consequences of this announcement particularly now in the current depressed business climate.

“FMM objects to the announcement which would put the manufacturing sector at a great disadvantage and cripple most of the manufacturing sector in the country, including the exporters who are one of the main revenue contributors to the economy,” he said in a statement on Thursday.

He added the decision would be most detrimental considering that manufacturers continue to contend with the impact of the challenging economic conditions due to the Covid-19 pandemic.

“Businesses are still reeling from the impact of the Covid-19 pandemic and the lockdown and are working on rebuilding their operations.

“As it stands now for most companies, overall business activities including sales both domestic and export for the next six months is still expected to be low as they continue with their business revival and recovery,” he said.

Soh said FMM was cognisant of the fact that the unemployment rate amongst locals was on the rise, with the latest rate reaching 5.3 per cent in May.

He said initiatives must be taken to ensure that displaced workers are able to secure jobs quickly, adding that manufacturers would definitely be encouraged to ensure that vacancies be filled by locals.

He pointed out that business recovery might take anything between four months and two years, depending on the sectors and the impact that Covid-19 has had on the business.

According to him, supply chains continue to be impacted with delays in deliveries from suppliers and with shippers experiencing increase in logistics and shipping costs, increase in raw material prices as well as supply shortages.

By abruptly stopping the hiring of foreign workers, he said the supply chain would be disrupted as local workers tend to avoid jobs in the manufacturing sector despite the offer of higher wages, due to its more challenging nature.

As such, he said business sustainability and jobs were at stake, even for local workers.

Soh opined that the government should look at the manufacturing ecosystem in totality by considering all relevant factors which would have an impact, and not specific issues in isolation.

“FMM has always maintained that businesses are aware of the need to reduce dependency on foreign workers but any changes to the policies should be in discussion with stakeholders, pre-announced and gradual, to allow companies to adequate time to adjust.

“Changes and especially drastic changes with significant impact on business cost and sustainability must not be made overnight,” he added.

He said FMM hoped that the government would reconsider its decision and call industry stakeholders to discuss and work together on a more acceptable solution for all to be implemented only when economic conditions improved. – Borneo Post